Experts have warned the total value of UK assets has dropped by 5.5 per cent in real terms in the last year, losing £470 billion.

A report from Capital Economics, a research consultancy group, found borrowing costs were up while the value of shares and homes fell.

Their latest update on the economic situation found: “The euro-zone crisis has already had an adverse impact on the consumer sector in various ways, including higher borrowing costs and a possible dent to confidence. More recently, falling equity prices have added to the pain.

“We estimate that the total value of household assets has fallen by around 2.5 per cent, or £200 billion, over the last year. In real terms, the drop has been around 5.5 per cent.

“The evidence suggests that spending on big ticket items, such as private education or cars, has tended to fall most sharply when wealth has declined. More surprisingly, households have also tended to cut back on their weekly food shop.

“In contrast, it seems as if spending on clothing has had an inverse relationship with wealth, perhaps as households have shifted their spending towards lower-value items.

“Overall, the recent fall in equity prices is another reason to expect the upturn in real household spending seen at the end of last year to fizzle out. We continue to expect real household spending to fall this year, by around 0.5 per cent.”

Yesterday, Nick Clegg said he feared a wave of “extremism and xenophobia” would sweep across Europe as a result of the debt crisis.

The Deputy Prime Minister warned leaders must take urgent action as the public lost faith in the EU “as a whole”.

His comments come as David Cameron spoke out about next month’s Greek elections would be the moment when the country has to decide whether to remain in the euro or to leave.

Speaking in Chicago at a Nato meeting yesterday, the Prime Minister said: “It’s very important that everyone is clear that the choice Greece faces is maintaining its commitments and maintaining itself in the eurozone, or deciding that’s not the path it wants to take, he said.

“It’s up the Greeks how people do and don’t vote but we’ve got to make sure it’s a moment of clarity and decisiveness for the eurozone.”

The G8 summit saw continued tensions over Germany’s role in resolving the eurozone crisis. Angela Merkel of Germany rejected pressure from other leaders for Germany to help underwrite the debts of weaker eurozone members.

Mr Cameron insisted he had been right to speak out, adding: “This affects us: 40 per cent of Britain’s exports go to eurozone countries. What happens in the eurozone matter to the United Kingdom.”